OTIS
Otis Worldwide Corporation
$72.77
Stable Earnings Power
65%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 18.9% above fair value
You pay
$72.77
Bear
$48.97
Fair
$61.21
Bull
$73.45
Bear
$48.97
-32.7%
$3.57 × 12x P/E
Fair
$61.21
-15.9%
$3.57 × 15x P/E
Bull
$73.45
+0.9%
$3.57 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
20.4x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $92.00 from 13 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $61.21 per share.
Warnings
Wall Street's average price target is $92.00 (from 13 analysts). Our estimate is 42% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples